4.1 Historical development prior to Chirwa v Transnet Ltd &
Others115
For several years, the question as to whether disgruntled public sector employees could rely on administrative law provisions in employment disputes grappled the minds of our courts in a diverse line of incompatible court decisions.116 Some judges argued that claims under PAJA could not be pursued since dismissals of employees do not constitute administrative
111 Transnet Ltd & Others v Chirwa [2007] 1 BLLR 10 (SCA) at para 58.
112 United National Public Servants Association of South Africa v Digomo NO & Others 2005 (26) I U 1957 (SCA) at para 4.
113 Transnet Ltd & others v Chirwa [2007] 1 BLLR 10 (SCA) at para 60.
114 See Ngcukaitobi 2008 (29) ILJ 853.
115 [2008] 2 BLLR 97 (CC).
116 Olivier and Smit Labour Law and Social Security Law 7 and Olivier 1994 SAPL 50.
action,117 whilst others argued that employees could rely on PAJA.118
These decisions ultimately led to the Cft/nva-matter in which the Constitutional Court made a final, yet in my view a disappointing ruling.
In order to accentuate the conflict previously created vis-a-vis this question, a number of contradictory judgments will briefly be discussed.119
In Louw v SA Rail Commuter Corporation Ltd & Another,^20 the court held that, even though the employer was a public authority, its power to terminate a contract of employment derived from the common law principles of contract, and that the employer accordingly did not perform a public function, nor did it implement legislation. In Phenithi v Minister of Education and Others,™ a judgment handed down by the Supreme Court of Appeal, the court held that the provisions of section 14(1) (a) of the Employment of Educators Ac?22, do not constitute reviewable administrative action since the dismissal was through the operation of law.123 Nevertheless, in a number of preceding and subsequent judgments, our courts have held that it could in fact be possible to utilise the provisions of PAJA since PAJA
117 See for example Greyvenstein v Kommissaris van die SA Inkomste Diens (2005) 26 ILJ 1395 (T), Phenithi v Minister of Education and others [2006] 1 All SA 601 (SCA).
Also Grogan 2008 (24) (1) Employment Law 5.
118 See, amongst others, Mbqyeka & Another v MEC for Welfare, Eastern Cape [2001] 1 All SA567 (Tk), Dunn v Minister of Defence & Others 2005 (26) ILJ 2 1 1 5 ( f ) .
119 Due to length constraints, reference will only be made to the most important and controversial judgments.
120 2005(26) ILJ 1960 (W).
121 Phenithi v Minister of Education and Others [2006] 1 All SA 601 (SCA). The facts of this case are briefly as follows: the appellant, Mrs Phenithi, was discharged from active service in terms of section 14(1) (a) of the Employment of Educators Act 76 of 1998 since she was absent from work for more than 14 consecutive days without the consent of her employer. The appellant then argued that section 14(1)(a) was in conflict with the provisions of section 188 of the LRA, which relates to unfair dismissals, and that it, amongst others, violated her right to fair administrative action.
122 Act 76 of 1998.
123 See Phenithi v Minister of Education and Others [2006] 1 All SA 601 (SCA) at para 9425 E-F.
provides for an administrative cause of action which is disparate from the cause of action provided for by the LRA.124
4.1.1 Contradicting approaches in the application of the Labour Relations Act 66 of 1995 and the Administrative Justice Act 3 of 2000
In order to explain the reasoning in the C/7/nva-judgment, which is discussed later in this dissertation, reference needs to be made to the two leading cases preceding it. These cases will clearly demonstrate the two approaches, as discussed earlier in this dissertation.125
4.1.1.1 POPCRU & Others v Minister of Correctional Services &
Others [2006] 4 BLLR 3 (E)
The case discussed in this section will illustrate the harmony in which PAJA and the LRA could co-exist.
In POPCRU & Others v Minister of Correctional Services & Others,™6
discussed in chapter 3 above, it was argued, for the respondents, that a decision to dismiss did not constitute administrative action, since it did not affect the public, but was part of internal decisions. The court, per Plasket J, held that the concept of public power does not necessarily denote that such power should have some form of impact on the public at large, and,
124 See Olivier and Smit Labour Law and Social Security Law 7. This view is apparent from, amongst others, POPCRU & Others v Minister of Correctional Services & Others [2006] 4 BLLR 385 (E); Dunn v Minister of Defence & Others 2005 (26) I U 2115 (T);
De Jager v Minister of Labour [2006] 7 BLLR 654 (LC). Cases in which it was decided that employment decisions by public sector employers comes down to administrative action and where PAJA will be applicable, is all distinguishable from each other albeit for reasons relating to dismissals, unfair labour practices or cases sourced in contract and not in statute. It seems that the question as to whether a decision constitutes 'public power' will depend on the facts and nature of each case.
125 See para 3.3 supra.
126 [2006] 4 BLLR 3 (E).
furthermore, held that the dismissal amounted to administrative action.127 The court further held that to remove PAJA from public sector employment disputes will imply that the constitutional right to fair labour practices now
"trumps every other right" and went on to say that there is in principle nothing wrong when employees have more remedies applicable to them to exercise rather than less.128
The difficulty with this line of thinking is that it may result in forum shopping and different outcomes in different tribunals and in some instances raise serious questions of jurisdiction. The result of having different outcomes may also lead to legal uncertainty.
When public sector employers employ and let off their employees this may not, simply stated, have the same effect as a contract between a private employer and employee. To a certain extent, when public sector employers' power to employ is derived from statute, it would appear to be a matter of particular public character and importance since the public as a whole are indeed affected by the actions of state employees, particularly in circumstances where public sector employees' decisions are of public nature.
4.1.1.2 The South African Police Union v National Commissioner of the South African Police Service [2006] 1 BLLR 42 (LC)
The case discussed in this section will support the argument that the LRA should be the supreme "power" in employment disputes.
127 See POPCRU & Others v Minister of Correctional Services & Others [2006] 4 BLLR 385 (E) at para 53. Ngcukaitobi 2008 (29) ILJ 855.
128 See POPCRU-judgment ibid at para 59-60. The court held that "the protections afforded by the labour law and administrative law are complementary and cumulative, not destructive of each other simply because they are different."
In the South African Police Union v National Commissioner of the South African Police Service^29 is a noteworthy judgment in which it was
emphasised that the LRA should solely be applicable in employment disputes and . The court, per Murphy AJ (as he then was), held that there was nothing public about setting working hours, since it fell within the realm of internal conduct premised on "a contractual relationship of trust and good faith" and that "the concept of administrative law is not intended to embrace acts which are already properly regulated by private law".130 According to this judgment, actions of public sector employers will and should fall mainly in the sphere of employment law and the laws that govern it.131
The distinction between administrative action of public sector employers and conduct which falls within the ambit of private law (LRA) will in practice be difficult to sustain, since many functions of public sector employers are frequently being outsourced to private actors - as rightly pointed out by Murphy AJ.132 The SCA in Logbro Properties^33 held that tendering will constitute administrative action. Tendering, just as employment, involves a contractual relationship. However, Murphy AJ held that there is a considerable difference between tendering and employment in that
129 [2006] 1 BLLR 42 (LC). This case involved a new shift system to replace the traditional 12 hour shifts of the SAPS. The decision was challenged and a dispute was referred in that it amounted to a unilateral change in their terms and conditions of employment. The matter remained unresolved and the dispute was referred to the labour court on the ground that the respondent breached the bargaining council's and its member's rights to just administrative action under PAJA. The applicants argued that the change in the shift system was sourced in section 24(1) of the Police Service Act 68 of 1995 and the decision thus amounted to reviewable public power whilst the
respondents argued that the decision could not constitute administrative action since it flows from al collective agreement which is part of the managerial powers. The S4PL/-judgment was followed by the Labour Court in Hlope and Others v The Minister of Safety and Security and Others [2006] 3 BLLR 297 (LC).
130 South African Police Union Ibid at para 51 and 52.
131 South African Police Union Ibid at page 44.
132 South African Police Union Ibid at para 52.
133 Logbro Properties CC v Bedderson NO & Others 2003 2 SA 460 (SCA).
tendering serves the public interest and impacts on the rights and interests of external parties whilst employment involves mere internal processes.134 The court further held that the Constitution draws a distinction between the
right to administrative action and the right to fair labour practices in that they have distinct forms of regulation and subsequent remedies. It was held that, even though it might be a fine line, the Constitution treats them as two
distinct and severed acts.135 This seems to be formalistic in that it focuses too much on the how it appears than on the real content and meaning of each case. It is argued that the rights in the Bill of Rights should be read together and stands in harmony with each other and the rights enacted to give effect thereto.136
Accordingly, Murphy AJ held that:
There seems to be no logical, legitimate or justifiable basis upon which to categorise all employment conduct in the public sector as administrative action, if only because of the principle of equality, and especially in the light of the express provisions of the definition of "administrative action" in PAJA. [own emphasis added]
The controversy augments when one has regard to Nxele v Chief Deputy Commissioner, Corporate Services, Department of Correctional Services™7
where the court was faced with the transfer of an employee to another post.
The court followed the POPCRU-judgment and distinguished the SAPU- judgment and held that public power was involved in that section 14(1) of the Public Services Act, 1994 permits transfers "when the public interest so
134 SAPU & another v National Commissioner of the South African Police Service &
Another [2006] 1 BLLR 42 (LC) at para 52. It was also pointed out that one should be mindful of the fact that collective bargaining is aimed at realising equality between the employer and its employees and that the public sector employees are thus placed on the same footing as their employers.
135 SAPU Ibid at para 53.
136 Sections 23 and 33 of the Constitution of the Republic of South Africa, 1996 should be read together so as to have the same effect on the LRA and PAJA in its application and reach.
137 [20061 10 BALR 960 (LC).
requires"138 and that the actions, therefore, amounted to the exercise of
"public power". The court thus held that discretionary power to transfer was derived from statute and not through the execution of a contractual right.139
The court was not persuaded that the LRA "must be taken impliedly to have removed existing rights enjoyed by public sector employees".140
4.2 The decision of the Supreme Court of Appeai in Transnet Ltd v Chirwa141
Consequently, the divergent views of the courts on this issue were such that no consistent approach couid possibly have been followed. The inconsistency and legal uncertainty resulting from the conflicting judgments was cleared in the renowned Crwrwa-case,142 where the High Court held that the dismissal of an employee amounted to administrative action which should be reviewed by the applicable administrative law principles. The High Court, however, based its decision on certain common law principles, and not on the application of PAJA or section 33 of the 1996 Constitution.
Subsequently, the SCA was approached to consider (1) whether the dismissal constituted "administrative action" within the meaning of PAJA;
and (2) whether the dismissal was a matter that had to be determined exclusively by the Labour Court in terms of section 157(1) of the LRA. The SCA was split 3:2 on the outcome of this matter. A brief outline of both the majority and the minority judgments will be given below. The focus of the
138 Nxele v Chief Deputy Commissioner Corporate Service Department of Correctional Service and Others [2006] 10 BALR 960 (LC) at para 59.
139 Nxele ibid at para 67.
140 Nxele ibid at paras 69-70. See also Holness 2008 (71) THRHR 143.
141 [2007] 1 BLLR 10 (SCA).
142 The facts of this case are, briefly, the employee (Chirwa) was dismissed for poor work performance. The employee did not attend her disciplinary enquiry as the presiding officer was allegedly biased. The applicant challenged her dismissal in the High Court on the basis that the dismissal violated her constitutional right to fair labour practices and to have the dismissal reviewed and set aside. The High Court decided that the dismissal amounted to "administrative action" in her favour in that there was no compliance with the audi alteram partem principle. Transnet appealed on the grounds that the High Court lacked jurisdiction and that the actions of Transnet, as the employer, did not amount to administrative action.
discussion below will only be on the applicability of PAJA. The question as to whether the High Courts will have jurisdiction to adjudicate on matters alike is not discussed in this dissertation.
4.2.1 Majority judgment
Mthiyane JA, with Jafta JA concurring, held that the termination of Chirwa's contract of employment did not constitute an "administrative action" as provided for under PAJA. The majority held that the termination of a contract of employment does not involve any form of public power or public function in terms of any legislation.143 The court held that "the power to dismiss is found not in legislation, but purely in the employment contract'.144 However, in section 1 of PAJA, an "empowering provision" is defined as:
. . . a law, a rule of common law, customary law, or an agreement, instrument or other document in terms of which an administrative action was purportedly taken.
According to the meaning of "empowering provision" one can argue that an administrative action can be based in contract and the mere fact that the action was founded in contract can therefore not necessarily result in a blatant exclusion of PAJA; provided that it is borne in mind in this regard that the administrator is a "natural or juristic person, other than an organ of state"145
According to this judgment, public sector employers can be "released" from their inherent public nature and act as ordinary employers without the stigma of "public interest" affecting them. The court in effect held that the
143 Transnet Ltd & others v Chirwa [2007] 1 BLLR 10 (SCA) at para 14. In this regard the court made reference to President of RSA v South African Rugby Football Union 2000 (1) SA 1 (CC) where the court held that "the test for determining whether conduct constitutes administrative action is not the question whether the action concerned is performed by a member of the executive arm of government."
144 Transnet Ltd & others v Chirwa [2007] 1 BLLR 10 (SCA) at para 15.
145 Section 1 of the PAJA.
common law and the administrative law which have been applicable to public sector employers are no longer good law.146 It is nevertheless evident that, if the legislature intended to exclude PAJA, it would have and could have done so expressly when PAJA was enacted to give effect to section 33 of the Constitution.147
Conradie JA, accepted that the dismissal in Chirwa did constitute administrative action in that dismissals in the public sector "necessarily has the procedural attributes of administrative action".148 Conradie JA however further argued that since the enaction of the LRA, the structure of the legislation no longer entail that dismissals in the public sector be dealt with as administrative actions.149 According to the arguments set out above the legislature could not have intended for public sector employees to have a right to choose the protection of either the LRA or PAJA. This in effect means that public sector employee's right to an administrative cause of action in terms of PAJA in dismissal disputes vanished through the enactment of the LRA.
4.2.2 Minority decision
The minority judgment was written crisply and to the point by Cameron JA Mpati DP concurring. Cameron JA disagreed with Mthiyane JA and Conradie JA and argued that:
. . .the Constitution permits an employee of a public body to seek relief in the ordinary courts for dismissal related process injustices that constitute administrative
146 Partington and Van der Walt 2007 Obiter 390.
147 /5/dat391.
148 Transnet Ltd & others v Chirwa [2007] 1 BLLR 10 <SCA) at para 26.
149 Transnet Ltd & others v Chirwa [2007] 1 BLLR 10 (SCA) at para 27.
150 Transnet Ltd & Others v Chirwa [2007] 1 BLLR 10 (SCA) at para 47.
The minority judgment was premised on two main questions: (1) if there were no LRA, would public sector employees bring their claims under
PAJA, and, (2) if they can, did the LRA take away that entitlement?151 It was held that the existence of a contract between Ms Chirwa and Transnet did not alter the public relationship due to the fact that one in fact deals with a public entity created by legislation which exercises public power in "the ordinary course of administering the business of Transnet".152 It is this very public dimension which renders the contract administrative in nature and subject to PAJA. Furthermore, the fact that a public sector employee has remedies under the LRA should not preclude the employee from seeking remedies under PAJA. Cameron JA held in paragraph 63:
No doctrine of constitutional law confines a beneficiary of more than one right to only one remedy, even where a statute provides a remedy of great amplitude.
Cameron JA explained that the enactment of the Constitution, the LRA and PAJA did not supersede the predated Zenz/Ve-judgment, but that it endorsed its reasoning.153 The LRA's remedies can never be seen as exhaustive of those remedies that may be available to employees through their employment and that one action can give rise to more than one cause
of action, namely, in terms of section 23 of the Constitution as given effect in the LRA and in terms of section 33 of the Constitution as given effect to by PAJA.154 The minority judgment of the SCA in Chirwa can arguably be used to argue that public sector employees can challenge their dismissals and unlawful employment practice grievances as an infringement of their right to just administrative action.
151 Transnet Ltd & Others v Chirwa [2007] 1 BLLR 10 (SCA) at para 49 and Partington and Van der Walt 2007 Obiter 394.
152 Transnet Ltd & Others v Chirwa [2007] 1 BLLR 10 (SCA) at para 53. This line of reasoning was followed in Grey's Marine Hout Bay (Pty) Ltd & others v Minister of Public Works & Others 1991 1 SA 21 (A) at para 28.
153 Transnet Ltd & Others v Chirwa [2007] 1 BLLR 10 (SCA) at para 53.
154 Fediife Assurance v Wolfaardt 2002 (1) SA49 (SCA).